Today, the ready to drink (RTD) market is one of the fastest-growing food and beverage sectors in the world. Projected to reach a global value of more than $42 billion by 2027, it’s seen the entrance of a number of key players in recent years, including Starbucks, illycaffè, and Costa Coffee.
The convenience, rising quality, and perceived health benefits of RTD coffees are the key drivers behind this trend. For some, they’re seen as a natural alternative to traditional carbonated energy drinks, while others have seen them as an easy and accessible way to continue drinking coffee during Covid-19 closures.
With no signs of its growth slowing, the RTD coffee market presents an opportunity for specialty roasters to increase their revenue streams and appeal to a wider range of customers by offering their own range.
To find out more about RTD coffees and why roasters should consider adding them to their line of products, I spoke with 2018 Hellenic Barista Champion and Head of Quality Control at Samba Coffee Roasters, Michalis Katsiavos.
Read next: The Rise Of RTD & Cold Brew Coffee
What is RTD coffee?
A ready to drink (RTD) coffee is a chilled coffee that comes pre-made in a can or bottle. The concept emerged in the mid-1990s, when Starbucks started selling their widely successful frappuccino across US stores. The drink contained Starbucks’ signature coffee, low-fat milk, sugar, and thickening agents.
Since then, the number of RTD coffees on the market has increased significantly, with a wide range of coffee brands offering their own take on the concept. For example, Costa Coffee now sells its three most popular types of coffee in cans, while US coffee chain Blue Bottle offers iced coffee in cartons, including dairy milk latte.
But it’s not just the multinationals that have entered the growing market: emerging brands, such as Philadelphia-based La Colombe (which started as a high-end specialty coffee shop), have also taken advantage of the developing trend.
Today, the global RTD coffee market is valued at more than $22 billion, with experts predicting it to continue growing exponentially over the next six years. One of the key drivers behind this growth is the changing behaviour of consumers, particularly those classed as millennials and Generation Z.
Michalis has worked in the coffee industry for more than a decade and tells me the attraction of RTD coffee for young people lies predominantly in its convenience.
“Over the last few years, RTD coffee has become really popular in the specialty coffee market, especially cold brew,” he says. “We’re seeing lots of coffee shops offering cold brew in beautiful bottles, cans, and other styles of packaging. This makes it easier for consumers to buy their favourite coffee in a quick and on-the-go fashion. Also due to the fact that we’re living during a global pandemic, RTD coffee makes our life easier and that’s why the demand for these products is increasing.”
How good is the quality?
From nitrogen cold brew to dairy-free lattes, RTD coffees have carved out a unique space in the coffee market. However despite their rise in popularity, some continue to question the quality of RTD coffees and whether they match traditional specialty options.
One of the main criticisms centres on the use of sugar and flavourings which mask the distinct characteristics of the coffee. For example, in a Starbucks Double Shot Espresso can, there are flavourings, sweeteners, and acidity regulators.
That being said, as more and more small-scale specialty roasters enter the market and use RTD products as an extension of their brand, the focus has increasingly switched to improving their quality.
Indeed, Michalis tells me that while RTD coffees shouldn’t be compared with fresh filter and espresso coffee, some coffee shops have gone to great lengths to maintain quality consistency.
“When we talk about RTD coffees we have to keep in mind what is going on with the quality of the final product,” he says. “We absolutely can’t compare the quality of freshly prepared coffee with RTD coffee. But lots of coffee shops are doing a really good job in trying to keep the quality standards high across all their beverages. When we’re looking for RTD coffees, we should look out for these places.”
What are the benefits of offering RTD coffee?
For specialty roasters, adding RTD coffee to their line of offerings has several benefits. For one, it provides access to new areas of the market, opening up an extra revenue stream and the opportunity for higher profits.
In particular, RTD coffee can be used to appeal to health-conscious consumers who are increasingly ditching carbonated soft drinks.
RTD coffee has long been positioned as a good pre and post workout beverage, with many roasters utilising the coffee’s natural antioxidant content to promote it as an important part of a healthy lifestyle. Cans and cartons of RTD coffee can be sold in locations inaccessible to regular coffee drinks, such as in supermarkets and vending machines.
Another benefit is the relatively long and stable shelf life of RTD coffee. Unlike ground and whole bean coffee, which reaches its peak a few weeks after roasting, many RTD drinks have a shelf life of between three and six months, with little change to their flavour stability during that time.
This means that specialty roasters don’t have to worry about distributing these cans and cartons soon after being produced to ensure maximum freshness. Instead, it can be sent out to grocery stores, cafés, and vending machines where it can sit for months before being bought and consumed.
For Michalis, one of the main benefits of offering RTD coffee to customers is the additional branding opportunity it presents. Consumers who haven’t ventured into the coffee section of a store may have their attention caught by the attractive cans and cartons used for RTD coffee.
“In general, the packaging and the branding of a product is really important,” he explains. “It’s the first impression you have before you buy something and it can tell you a lot about a brand and its values. With good design, RTD coffee gives you another opportunity to catch the eye of potential customers.”
At MTPak Coffee we offer a range of sustainable packaging options for specialty roasters, whether selling whole bean, ground, or RTD coffee. Our selection of recyclable, biodegradable, and compostable materials can be fully customised to your needs, helping to shape your brand identity and showcase a commitment to the environment.
For more information about our sustainable coffee packaging, contact our team here.
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